Temple Bar Investment Trust (TMPL) - Dividend Declaration

[IanTHughes]

https://www.investegate.co.uk/temple-ba ... 3859P4823/

Temple Bar Inv.Tst
Dividend Declaration
TEMPLE BAR INVESTMENT TRUST PLC

THIRD INTERIM DIVIDEND

The Board of Temple Bar Investment Trust plc has today declared a third interim dividend for the year ending 31 December 2020 of 8.25p per ordinary share to be paid on 31 December 2020 to those shareholders registered at the close of business on 11 December 2020.

The shares will go ex-dividend on 10 December 2020.

The third interim dividend for the year ending 31 December 2019 was 11.00p, making this a reductions of 2.75p per share or 25%.

Interesting


Ian

[csearle]

Just out of interest, for those using ITs as part of a high yield income strategy, when might one anticipate any reserves/contingencies being exhausted following the inevitable hit of CV-19? Is it too soon for that?

A related question: is it possible that some will ride the recovery such that their reserves/contingencies completely mask such a hit?

Chris

[ADrunkenMarcus]

The third interim dividend for the year ending 31 December 2019 was 11.00p, making this a reductions of 2.75p per share or 25%.

Interesting

TMPL had increased the dividend for 35 years. It's no longer a dividend hero!

Best wishes


Mark.

[Arborbridge]

I'm wondering whether my HYP dividends might recover just as my IT dividends are falling

[Dod101]

Just out of interest, for those using ITs as part of a high yield income strategy, when might one anticipate any reserves/contingencies being exhausted following the inevitable hit of CV-19? Is it too soon for that?

A related question: is it possible that some will ride the recovery such that their reserves/contingencies completely mask such a hit?

Chris

Not exactly sure that anyone can answer that but the fact is that with Temple Bar, they have clearly signalled that they do not want to use capital gains to supplement the dividend nor do they feel that the Revenue reserves should be used to supplement it. Hence the reduction. What they may be telling us is that the new investment managers are not particularly promoting income.

As to the related question, I am sure that some will (and are) riding the recovery such that their reserves will completely mask any hit.

Dod

[moorfield]

ITs generally do not have piles of reserve cash sitting around to cover gaps despite what their balance sheets indicate, so they will have to (1) sell capital gains, (2) borrow to cover their dividends, or (3) cut.

TMPL took a dividend income of £39.5m last year and paid out £35.8m to its shareholders. The difference paid (not all of) the interest on its borrowings £4.9m, reducing its reserves. It has had £11.1m of cash to cover any gaps.

https://www.templebarinvestments.co.uk/ ... s-2019.pdf

Now stress that income by -30% which seems to be the early figure DIYers are reporting here, and it will be taking roughly £23m in dividend income this year, so its reduction seems to be in the right ballpark.

[Arborbridge]

ITs generally do not have piles of reserve cash sitting around to cover gaps despite what their balance sheets indicate, so they will have to (1) sell capital gains, (2) borrow to cover their dividends, or (3) cut.

TMPL took a dividend income of £39.5m last year and paid out £35.8m to its shareholders. The difference paid (not all of) the interest on its borrowings £4.9m, reducing its reserves. It has had £11.1m of cash to cover any gaps.

https://www.templebarinvestments.co.uk/ ... s-2019.pdf

Now stress that income by -30% which seems to be the early figure DIYers are reporting here, and it will be taking roughly £23m in dividend income this year, so its reduction seems to be in the right ballpark.

Sell capital: does it have to be a gain? (prudent, yes, but sale is a sale)

[Dod101]

Sell capital: does it have to be a gain? (prudent, yes, but sale is a sale)

This is all a bit confusing now because we need to distinguish between using revenue reserves and using capital gains to supplement the dividend. In other words the accounting treatment. In fact they will raise cash from wherever it is most convenient I imagine, most likely from sales of assets which they will do in the course of their business anyway.

Dod

[moorfield]

Sell capital: does it have to be a gain? (prudent, yes, but sale is a sale)

Well with your HYPsters hat on which would you sell/trim first if you needed to fill the hole? - AZN bought at 2914p or RDSB bought at 2008p? (those are my average costs btw).

[Arborbridge]

Sell capital: does it have to be a gain? (prudent, yes, but sale is a sale)

Well with your HYPsters hat on which would you sell/trim first if you needed to fill the hole? - AZN bought at 2914p or RDSB bought at 2008p? (those are my average costs btw).

You wrote they would sell at a profit: I was actually just wondering if there was any legal reason which control this. If they can sell at a loss, that adds another bullet point to your list of possibilities, that's all I meant.

Arb.

[ADrunkenMarcus]

If you're reinvesting dividends then a low share price is a benefit. I saw that in 2008-09 when my TMPL dividends bought an increasing number of shares each time they were paid and reinvested automatically. That benefit is diluted somewhat when the dividend is cut.

Best wishes

Mark.

[Arborbridge]

If you're reinvesting dividends then a low share price is a benefit. I saw that in 2008-09 when my TMPL dividends bought an increasing number of shares each time they were paid and reinvested automatically. That benefit is diluted somewhat when the dividend is cut.

Best wishes

Mark.

It's a good principle to invest in pooled investments like ITs when the price is down - eventually, they generally turn around, but by no means always.
I've been doing that with TMPL since 2011, investing occasionally on dips, but the trashing of the share price this year has undermined everything gained, leaving a very slow overall progress with a TR of 4%-ish for 9 years. Ouch, Given courage and resources, I should be plugging more in now, but wll it really come right eventually? My patience is beginning to fray, and the change of manager, far from helping, has worked against my enthusiasm for the moment.

On balance, if I was flush with funds, I might keep taking the medicine and invest another dollop, but at the moment I'm not
The outlook is hardly encouraging for UK stocks, and I fear TMPL will be held back if only because of that, even though it owns shares in some worthy companies.

Arb.